Tower Bancorp, Inc. EXECUTIVE INCENTIVE PLAN 2011

EX-10.3 4 dex103.htm TOWER BANCORP, INC. EXECUTIVE INCENTIVE PLAN Tower Bancorp, Inc. Executive Incentive Plan

Exhibit 10.3

Tower Bancorp, Inc.

EXECUTIVE INCENTIVE PLAN

2011

Eligible Executives: General Counsel – Carl Lundblad; CFO – Mark Merrill; Chief Risk Officer – Jane Tompkins

Plan Features: 100% Holding Company Performance for the year ending December 31, 2011

Award Date: March, 2012

Total incentive bonus opportunity is 17.5% of base pay earnings at threshold, 35% of base pay earnings at target and 52.5% of base pay earnings at optimum.

Holding Company Adjusted Core Operating Earnings Per Share (40%)

 

  •  

Adjusted Core Operating Earnings are defined as GAAP net income less merger expense and other non-recurring items as publicly reported, and further excluding all additional losses and restructuring charges incurred in connection with the wind down and restructuring of the American Home Bank Division in 2011.

 

Target = $1.86

   

Bonus % (of base pay)

Threshold ³80% ($1.49)

    Up to 10%

Target ³100% ($1.86)

    Up to 20%

Optimum ³110% ($2.04)

    Up to 30%

Adjusted Core Operating Return on Tangible Equity (30%)

 

  •  

Calculated based on Adjusted Core Operating Earnings, defined as GAAP net income less merger expense and other non-recurring items as publicly reported, and further excluding all additional losses and restructuring charges incurred in connection with the wind down and restructuring of the American Home Bank Division in 2011.

 

Target = 9.7%

   

Bonus % (of base pay)

Threshold: ³80% (7.8%)

    Up to 7.5%

Target: ³100% (9.7%)

    Up to 15%

Optimum: ³110% (10.7%)

    Up to 22.5%

 

* This plan may be altered, modified, or terminated at any time and without notice.

Achievement of Strategic Objectives (30%)

 

•    Enhance brand profile of TOBC Stock

 

•    Successfully negotiate and execute on key strategic opportunities

 

•    Recruit and develop talent for key leadership positions

 

•    Effectively manage balance sheet to ensure strong capital profile

 

•    Achieve Best Place to Work recognition

    Bonus % (of base pay)

Threshold = Satisfactory

    Up to 7.5%

Target = Meets Expectations

    Up to 15%

Optimum = Exceeds Expectations

    Up to 22.5%

Qualifiers:

 

•  

Must achieve satisfactory rating on all regulatory exams.

 

•  

Executive must be employed on the date of payout.

 

•  

Executive must achieve a rating of “Good” (3) or higher performance level.

 

* This plan may be altered, modified, or terminated at any time and without notice.